Last Friday, September 11th, PR Newswire reported that Abbey Spanier LLP - a legal company specializing in class-action suits - filed a lawsuit on behalf of shareholders who purchased stocks in SFX Entertainment between the dates of February 25th and August 17th this year. The live music conglomerate was founded by current CEO Robert F. X. Sillerman in 2012, who released the company's IPO around this time two years ago when it was valued at a suggested $1.1 billion USD by the Securities and Exchange Commission. While it was reported then that individual stocks would be valued between $11 and $13, the current NASDAQ value sits at $.45 a piece and continues to dwindle - a roughly 90 percent drop from the first IPO estimate.

PR Newsire explains; "The Complaint alleges that throughout the Class Period [Feb. 25th - Aug. 17th], Defendant Sillerman repeatedly affirmed his commitment to acquire SFX. However, Defendant Sillerman knew or recklessly disregarded and failed to disclose that he did not have any financing in place at the time he made his proposal and knew or recklessly disregarded that he could not obtain the financing to consummate the transaction."

"The Complaint further alleges that given the Company's growing debt and decreasing margins it was not feasible that Sillerman was ever going to buy the Company and, with the aid of the other defendants, Sillerman initiated and maintained a sham process designed to lure third party offers, in an attempt to shed his failing investment before the truth about the deterioration of the Company could no longer be concealed. The effect of the false and misleading statements by Defendants during the Class Period was to fraudulently inflate and maintain the market price of SFX shares at levels that would not otherwise have prevailed based on the true financial performance and future prospects of the Company."

SFX Entertainment specializes in dance music events, operating well-known EDM-centric festivals like Tomorrowland, Electric Zoo, Stereosonic, and Voodoo Experience, as well as dance music retailer Beatport. Dates for the suit have not yet been revealed.